Compound Interest Calculator
Calculate investment growth with monthly contributions and compound interest
Calculate Your Investment Growth
Calculate Required Monthly Contribution
Amount you want to have in the future
Amount you invest each month
Starting amount (leave at 0 if not applicable)
Total Future Value
After years at % APR
Initial
Contributions
Interest
ROI: %
Return on investment
Starting with and contributing /month for years, you'll have . Total invested: , Interest earned: (% ROI).
Contributing /month for years, you'll have . Total invested: , Interest earned: (% ROI).
Your investment grows to , earning in interest (% ROI).
Required Monthly Contribution
To reach in years at % APR
š Congratulations! Your initial investment will already exceed your goal.
Initial grows to:
Total Invested
Initial + Contributions
Interest Earned
ROI: %
Investment Breakdown
Where your money comes from
To reach in years: Contribute /month. Total invested: , Interest: (% ROI).
To reach in years: Contribute /month. Total invested: , Interest: (% ROI).
How Compound Interest Works
Compound interest is interest calculated on the initial principal and on the accumulated interest of previous periods. Think of it as "interest on interest."
The Formula (for initial principal):
A = P(1 + r/n)^(nt)
- A = Future Value
- P = Principal (initial investment)
- r = Annual interest rate (as a decimal)
- n = Number of times interest is compounded per year
- t = Number of years
The Formula (for monthly contributions):
iā = (1 + r/n)^(n/12) ā 1
FV = PMT Ć ((1 + iā)^(tĆ12) ā 1) / iā Ć (1 + iā)
- PMT = Monthly contribution
- r = Nominal annual interest rate
- n = Number of compounding periods per year
- t = Number of years
- iā = Equivalent monthly rate for the selected compounding frequency
Monthly contributions are assumed to be made at the beginning of each month.
ROI (Return on Investment):
ROI = (Interest Earned / Total Invested) Ć 100%
Example: Contributing $1,000/month at 5% APR with monthly compounding for 10 years:
- ā¢ Total invested: $120,000
- ā¢ Interest earned: $35,929
- ā¢ Future value: $155,929
- ā¢ ROI: 29.94% (Excellent return!)
š” Tips to Maximize Compound Interest
- ā¢ Start early: Time is your biggest ally. Even small investments grow significantly over decades.
- ā¢ Higher frequency = better: Daily compounding earns more than annual, though the difference is small.
- ā¢ Regular contributions: Adding money regularly dramatically accelerates growth (use with a retirement calculator).
- ā¢ Watch the rate: A small difference in interest rate can mean thousands over long periods.